Singapore is a city-state and island nation in Southeast Asia, located at the southern tip of the Malaya Peninsula between Malaysia and Indonesia, as well as the Strait of Malacca and the South China Sea. It is a very small and highly urbanized country with a population of 5.5 million people.
In Southeast Asia, Singapore ranks first, and it ranks 5th globally. It is also ranked among the top 10 startup ecosystems in the world. Singapore was ranked as the fifth most innovative country in the world according to Global Innovation Index 2023.
Singapore has 4,500 tech startups, 400 venture capitalists, and 240 accelerators, venture builders, and incubators, creating a solid base for a competitive ecosystem. The city-state is becoming a global hub for Deep Tech, emphasizing technology-driven products based on thorough scientific research.
The city’s startup scene is especially strong in E-commerce & Retail, Foodtech, and Fintech. In the E-commerce & Retail sector, Singapore holds the 2nd position globally with 672 startups. In Foodtech, it also ranks 2nd worldwide with 463 startups. In Fintech, Singapore is ranked 3rd globally with 268 startups.
Singapore is working hard to become a leader in technology by fostering talent and supporting new businesses. The government is investing heavily in grants and initiatives to create a thriving startup ecosystem like Silicon Valley. Scholarship programs are introduced by the government to help attract skilled individuals, and various policies have been implemented to support and enhance the business environment.
The Singapore government offers various types of support for entrepreneurs, including Funding and Grants: Programs like the Business Improvement Fund (BIF), Enterprise Development Grant (EDG), Enterprise Financing Scheme (EFS), Market Readiness Assistance (MRA) Grant, Startup SG Equity Program, and Productivity Solutions Grant (PSG), Workforce Support: The Career Trial Program and Skills Future Enterprise Credit (SFEC), Digital Solutions: Initiatives such as Advanced Digital Solutions (ADS), Grow Digital, and Startup SG Tech, Tax Relief: The Double Tax Deduction for Internationalization (DTDi) and Equity Funding: Support from Angel Organizations. These resources help startups with funding, hiring, digital adoption, and tax relief.
Singapore is known for its excellent education and skilled workforce, making it a top choice for foreign and startup talent. It is transforming from a regional leader to a major global startup hub, thanks to its strong infrastructure and ample funding opportunities. The city-state is particularly preferred by tech startups due to its ease of doing business and has the fastest internet in the world, which supports efficient digital operations.
Under the Start-up Tax Exemption Scheme, companies in Singapore are taxed at a flat rate of 17% on their income. To encourage new businesses, the scheme offers tax exemptions on a portion of their profits during their first three years.
Singapore hosts key events like Innovfest Unbound, Asia Tech x Singapore, and SWITCH, where startups can network and showcase their ideas. The city-state excels in transport and digital infrastructure, ranking first globally in transport and first in Asia for digital infrastructure. Facilities such as AerialArena@SUTD and JTC LaunchPads offer crucial support for startups in Singapore.
Private investment in Singapore is strong, with global companies setting up headquarters there and major venture capitalists such as Sequoia Capital and B Capital having a strong presence there. Innovation hubs from Medtronic and McKinsey also boost the investment landscape. Foreign direct investment (FDI) rose to $40.2 billion in March 2024, compared to $56.1 billion in the previous quarter.
Conclusion
Singapore’s startup ecosystem offers a great environment for relocation and investment due to its strong education system, skilled workforce, excellent infrastructure and active investment landscape. The city-state is growing beyond its regional success to become a global startup hub thanks to its stability, innovation and financing opportunities.
It is a popular choice for tech startup founders due to its ease of doing business. Its reputation as a global business hub backed by a stable economy and thriving startup ecosystem attracts venture capitalists and investors, making it a prime location for successful global ventures.
FAQs
What is the entrepreneurial ecosystem of Singapore?
Singapore has 4,500 tech startups, 400 venture capitalists, and 240 accelerators, venture builders, and incubators, creating a solid base for a competitive ecosystem.
Why is Singapore a startup hub?
Singapore has become a global center for tech startups, attracting entrepreneurs and investors worldwide. Its vibrant ecosystem, government support, strategic location, top-notch infrastructure, favorable tax policies, and skilled workforce make it a great place for innovation and growth.
What is the start up scheme in Singapore?
Under the Startup SG Equity scheme, the government co-invests with approved third-party investors in eligible startups. For general tech startups, the government invests 70% of the funding up to SGD 250,000 and matches investments dollar-for-dollar up to a total of SGD 2 million.
What is the tax rate for startups in Singapore?
Under the Start-up Tax Exemption Scheme, companies in Singapore are taxed at a flat rate of 17% on their income. To encourage new businesses, the scheme offers tax exemptions on a portion of their profits during their first three years.
